Markets to remain highly volatile this week amid rising Covid-19 cases

On Friday, the BSE Sensex slipped 202 points to close the week at 47,878.45, while the Nifty fell  64.8 points to 14,341.35. -
Markets to remain highly volatile this week amid rising Covid-19 cases

NEW DELHI:  The ever-rising Covid-19 infections in India will continue to deter investors' sentiment in the near future, say experts after the stock market ended in the red zone last week.

Benchmark indices fell about two per cent during the week ended April 23 as markets remained under severe pressure due to record surge in Covid cases over three lakh cases per day, the highest in the world and restrictions placed by several state governments.

On Friday, the BSE Sensex slipped 202 points to close the week at 47,878.45, while the Nifty fell  64.8 points to 14,341.35. 

"Indian markets are likely to continue with volatility till Covid-19 cases continue the upward trajectory. Investors would continuously watch out the government's course of action along with progress on vaccination drive," said Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services. 

According to Rusmik Oza, Executive Vice President, Head of Fundamental Research, Kotak Securities, the fresh lockdowns and restrictions being imposed by various state governments will impact demand and also business activity.

The persistent rise in hard commodity prices is a threat which could weigh on margins of many manufacturing companies. "Too many potential negatives have come together which could impact markets in the very near future," said Oza. Investors will also keep an eye on the monthly expiry of April month 
derivatives contracts, core sector data and Q4 earnings. 

Prominent companies such as SBI Cards, Tech Mahindra, Axis Bank, Bajaj Finance, Britannia, Maruti Suzuki, TVS Motor, Bajaj Auto, Titan, IndusInd Bank, Marico and Reliance Industries will announce their results this week. Angel Broking in its note aid that the markets are completely clueless which way to move in the near term.

"At higher levels, we are facing some pressure as the pandemic continues and on the lower side, bulls are not willing to give up. Hence, it has become very difficult to take any kind of directional call," it said. Technical view wise, further downside may also be possible which could drag the index till 14000-13900/46500-46000. On the flip side, 14500/ 48300 would be the immediate hurdle for the Nifty/ Sensex, above the same uptrend structure will continue up to 14700/49100. Ahead of the monthly F&O expiry, the sectors which would be in focus are banking, metal and pharma, added Kotak.

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